The reasonableness of executive compensation arrangements has long been a contentious issue. The COVID-19 pandemic has accelerated pre-existing trends and introduced new challenges, including increased concerns about the widening pay gap between executives and the average Canadian employee, as well as demands for greater proportionality of outcomes for issuers’ various stakeholders. In this chapter, we explore the ways public issuers in Canada and the United States have adjusted their compensation structures in response to unanticipated disruptions. We also provide guidance for boards and compensation committees considering recalibrating their compensation plans. Finally, we discuss the pandemic’s impact on both current year and future say-on-pay votes and some renewed calls for mandatory pay ratio disclosure in Canada.
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Governance Insights 2020
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